Page 8 - Life Insurance Today July - December 2020

at Rs 7,325.59 crore in August. The NBP for Life Insurance The pandemic has forced consumers to realize the
Corporation of India (LIC) stood at Rs 19,714.21 crore, a rise importance of health insurance. Till August this year, the
of 15.19%. LIC's strong growth was likely driven by traction motor segment witnessed 15.7 per cent reduction in
in endowment and annuity-based products. The NBP of premiums, with own-damage premium falling over 17 per
individual single-premium and individual non-single cent and third-party premiums declining almost 15 per cent.
premiums delivered negative growth of 9.74% and 1.33%, Muted growth in the economy and subdued activity in auto
respectively, in August. Private life insurers saw the NBP for sales impacted motor insurance business. Holding the
individual single premium at Rs 1,097.79 crore, a growth premium rates for motor third-party insurance steady at last
of 59.52% against the same period last year. year's level may also have been a contributing factor. Fire
and Aviation premium saw one of the biggest rise this year
However, LIC saw its NBP for individual single premium however the given the fact that travel and tourism is the
down by 17.02% at Rs 5,429.57 crore in August, compared sector which have been worst hit by this crisis
to Rs 6,543.35 crore in the year-ago period. In August,
growth came due to the group single premium business, After a year-on-year (YoY) drop in premiums in the first
while individual investors are still staying away. We expect quarter of FY21, the non-life insurance sector reported
the individual business to pick up in the months to come as
positive growth in monthly premium in July 2020. The trend
situation improves on the economic as well as on the continued in August and the premiums grew 10.4 per cent
pandemic fronts. Among the listed insurers, HDFC Life, SBI
to Rs 17,623.2 crore:
Life and Max Life posted a 44.7%, 26% and 19.3% YoY
growth in NBP respectively in August, whereas ICICI
Prudential Life Insurance saw a 14.5% decline in new
premiums.

The health segment, on the other hand, saw 13 per cent in
Slow recovery rate of General Insurers rise, with retail health premiums growing at 33 per cent
General insurers reported just 0.02% growth between compared to the 10 per cent growth in group business and
March and August. Share of motor cover in most general a fall of 26.6 per cent and 83 per cent in government
insurers' portfolio was quite high. In August-September schemes and overseas travel insurance, respectively. Aditya
2019, motor insurers saw sharp growth following the roll Birla Health Insurance Co. Ltd, Star Health and Allied
out of the new Motor Vehicles Act, which made purchase Insurance Co. Ltd, Max Bupa Health Insurance Co. Ltd and
and renewal of auto insurance mandatory. They saw huge ManipalCigna Health Insurance Co. Ltd posted significant
boost to their motor portfolio last year and, therefore, the growth in premium. Health insurance is a living benefit
growth this year will not exceed that of last year. product and there is a shift happening in the mindset of
consumers. In the hierarchy of needs, health claimed primary
Standalone health insurance companies recorded 25.85%
position. People have started proactively looking to
growth in premium between March and August, as the
pandemic led more people to take health cover. Premium increase their coverage, and renewal has improved with
collection, however, dropped 7.05% from Rs.1,573.96 crore increasing upsell trend. COVID-19 specific products are also
in July to Rs.1,462.92 crore in August. picking up momentum, and overall outlook seems very
8 July - December 2020 Life Insurance Today